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Goldman Sachs Shared Its Contradicting Views on Bitcoin ETF

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Goldman Sachs Shared Its Contradicting Views on Bitcoin ETF
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Sharmin Mossavar Rahmani of Goldman Sachs Group Inc. is the chief investment officer of the private wealth management group at the investment bank. She shares her views on the Bitcoin ETF, saying that the ETF approval does not make cryptocurrencies a legitimate investment option.

The Metaphor of BTC ETF and Betting at Las Vegas

Sharmin Mossavar Rahmani has very well compared investing in Bitcoin with that of visiting Las Vegas and betting. She said,

“If you want to go to Las Vegas, great,” as per the reports of the Wall Street Journal.

The ideology behind this comparison is that she feels that Bitcoin is total speculation and should not be used for serious investing and return expectations, just like betting.

The consensus for this metaphor is high volatility, low regulations, low stability, and unknown credibility.

Why is Bitcoin Investment Considered Speculation?

She says that users can use and invest in cryptocurrencies for speculation purposes but not as a long-term investment. Further, risk-averse investors should stay away from cryptocurrencies; that’s what she suggests.

She shared similar views in an interview with Reuters. There, when she was asked, “When you think about it, is there any value to something like Bitcoin? She bluntly replied that they don’t even consider it an asset class to invest in.

Peter Schiff, a renowned economist, also pointed to the unlined high volatility and risks visible through the false announcement of Bitcoin ETF approval by U.S. Securities and Exchange Commission chair Gary Gensler.

With so many speculators expecting a rally, he does not believe that it will be achieved.

Conflicts in the Views of Goldman Sachs

She shared his views at the time when Goldman did not apply for the Bitcoin ETF after considering the application. So, it’s controversial that she does not consider crypto as an investable asset class but the company was planning to apply for it.

Moreover, it was also announced that GS was in talks with some of the ETF applicants to be their authorized participants (AP). The list includes the primary and major applicants of ETF, including BlackRock and Grayscale. 

In one of the statements, the company also mentioned that they do not promote these ETFs and that their company funds will not be involved in any of the investments through these ETFs. They do not support bitcoins or other cryptocurrencies because of a lack of cash flow and earnings and their extreme volatility.

So, it was ironic to be an AP that they don’t like to endorse or invest in.

Conclusion

It will be quite interesting to observe the movement of Bitcoin prices and the spot ETF launched by all 11 applicants. Some of the ETFs are getting early attention and were able to gain momentum even before the market opened on the listing day.

Now, users are keenly waiting to see the movement of ETFs and how they can regularize and reduce the volatility of cryptocurrencies.

There are also speculations about the ETFs on Ethereum and Solana to be released by the end of 2024.

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